WASHINGTON — The Office of the Comptroller of the Currency (OCC) today issued an OCC bulletin that highlights the unique characteristics of mutual savings associations (mutuals) that factor into the supervision of these community institutions.

In 2011, the OCC established the Mutual Savings Association Advisory Committee (MSAAC) to advise the OCC on ways to help ensure the continued health and viability of mutuals. During the April 2014 meeting, the MSAAC recommended that the OCC issue guidance to clarify areas that occasionally are misunderstood about mutuals.

The OCC bulletin describes the key distinctions of federal savings associations (FSA) organized in the mutual form of ownership from shareholder-owned or stock institutions. The guidance describes the governance structure and the rights of mutual members and outlines the traditional operations of mutuals. While safety and soundness principles for mutuals are generally the same as those for stock FSAs and national banks, there are some operational differences. The OCC bulletin provides additional detail regarding supervisory considerations for rating mutuals under each of the components of the Uniform Financial Institutions Rating System (more commonly referred to as CAMELS, which stands for capital, asset quality, management, earnings, liquidity, and sensitivity to market risk).

Most mutuals operate as community-based associations, focused on home mortgage lending and retail deposits. Compared with shareholder-owned or stock banks, mutuals tend to have higher capital levels. About 90 percent of mutuals have assets of less than $500 million. Almost 88 percent of mutuals operating today are more than 75 years old and 42 percent are more than 100 years old.